My best idea for getting climate change talks on track? Move them from December (freezing cold in key emitting countries) to sweaty July (making climate change more convincing to less evidence-based negotiators). George Monbiot agrees

‘The growing number and diversity of development organisations could be a source of strength in the aid system, if different organisations could stick to their specialities and if they worked in an aid environment which enabled them to work together effectively. Unfortunately, the political economy of aid encourages the opposite behaviour.’ Best example? ‘In the aftermath of the tsunami disaster a local doctor in Banda Aceh, one of the most affected areas, wrote: “In February, in Riga (close to Calang) we had a case of measles, a little girl. Immediately, all epidemiologists of Banda Aceh came in, because they were afraid of a propagation of measles among displaced people, but the little girl recovered very fast. Then, we realized that this was not a normal case of measles and we discovered that this girl has received the same vaccine three times, from three different organizations. The measles symptoms were a result of the three vaccines she received.”

Microfinance supporters and critics are out in droves to discuss the looming MF crisis in Andhra Pradesh (being likened to a kind of microfinancial subprime meltdown), The Aid Watch blog is following events here and here

This week’s fix of Hans Rosling, the data presentation guru, explaining the last 200 years of human progress in 200 countries – in 4 minutes, apparently in an abandoned building. Epic. [h/t Chris Blattman]

and you can see the man himself on BBC four Tuesday and 9pm, presenting ‘The Joy of Stats’. Oh dear.

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The situation in Andhra Pradesh is certainly very bad indeed, though entirely predictable based on the negative experience of highly commercialised microfinance elsewhere (e.g., Bolivia’s ‘boom-to-bust’) and other ‘boom-to-bust’ situations, such as the US savings and loans catastrophe in the 1980s. Indian commentators are now admitting that the sub-prime-like expansion of microcredit in Andhra Pradesh has not just produced NO tangible benefits for the poor, but it has placed at risk the entire finacial system in Andhra Pradesh, subjecting it to a repeat showing of Wall Street’s 2008 meltdown. This is not surprising really, when you read in the just released ‘India Microfinance Survey 2010′ that the poorest households in Andhra Pradesh were in 2009 on average in possession of just over 9 (nine) microloans per household! Clearly, a huge chunk of the poor are simply accepting a new microloan to repay another and, overall, using easily available microloans to cover for income that they just dont have.

Unfortunately, its not just in Andhra Pradesh where people are now looking back on the rise of microfinance with increasing anger and despair. The iconic Grameen Bank is in serious trouble for having quietly transferred around $100 million of donor funds within the Grameen group of companies without telling the Norwegian government who gave them the funds (to be used for housing loans). Seems like the money was actually going to be used to prop up the Grameen Bank, at a time when it was widely known to be in serious trouble because the widely trailed repayment rate (98%!) was, in practise, much much lower than this. Clearly, the poor did NOT always pay back, you might say. But by placing much of this Norwegian grant funding into microloans that could earn a high and quick return, the financial gap could be quickly patched up, or so was the hope it seems. It will be interesting to see what comes out of this mess, but certainly the anger is growing alarmingly – seehttp://blogs.wsj.com/source/2010/12/06/microfinance-is-grameen-founder-muhammad-yunus-a-bloodsucker-of-the-poor/

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This is a conversational blog written and maintained by Duncan Green, strategic adviser for Oxfam GB and author of ‘From Poverty to Power’.
This personal reflection is not intended as a comprehensive statement of Oxfam's agreed policies.